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Asian Tribune is published by World Institute For Asian Studies|Powered by WIAS Vol. 12 No. 883

Bangladesh-Malaysia Ties

By Dr. Abdul Ruff Colachal

Like Malaysia, Bangladesh, a predominantly Muslim country with around 87 per cent of its 140 million population being Muslim, has also earned international recognition for its moderate religious and cultural ethos, social tolerance and ethnic cohesion, which characterizes Bangladesh as a liberal, tolerant Muslim country. Being co-members of OIC, NAM Commonwealth, D-8 and ARF and as strong proponents of the multilateralism, the two countries share common perception on major Regional and International issues and have been working closely in the International arena to promote peace, stability, and development. About 200,000 Bangladeshis work in Malaysia and people to people contacts between these two nations have been excellently maintained, occasional irritations notwithstanding.

Bangladesh and Malaysia enjoy good bilateral relations based on the foundation of common religion, history, and culture. Over the years, thus, the relations between the two friendly countries have grown in depth and diversity and reached a matured stage. The state of good relations is reflected in the fast-growing bilateral cooperation spanning across a broad range of sectors, including economic and technical assistance, trade and investment, employment of Bangladeshi work force in Malaysia, defense-cooperation, education exchange, tourism, culture and sport, technology-transfer and human resource development.

The relationship developed in a steady momentum. Today, Malaysia is the largest Asean investment partner of Bangladesh and Malaysian companies invested about RM4.1 billion (US$1.3 billion) last year in 59 projects, mainly in telecommunication, power, textiles and financial sector. However, with regard to bilateral trade between both countries, the figures had been lopsided with Bangladesh suffering a chronic trade deficit with Malaysia, exporting only RM53.5 million (US$16.9 million) in the 2006-2007 period while imports were RM1.2 billion (US$384.16 million).

Malaysian Prime Minister Mahathir bin Mohammed’s visit to Bangladesh in 1999 and Prime Minister Sheikh Hasina’s return visit to Malaysia in 2000 infused new dynamism in the bilateral relations between the two countries. The visits opened up new vistas of cooperation and ensured the continuing export of skilled manpower from Bangladesh to Malaysia.

Bangladesh High commissioner in Malaysia Shafi U. Ahmad said in March 2004: Potential Malaysian entrepreneurs are invited to invest in the most attractive sectors such as power generation, telecommunication, infrastructure projects and relocating their labor-intensive sunset industries like textiles and ready-made garments, light engineering products, electronics as well as furniture factories."

Malaysia, South-East Asia’s third largest economy, has an estimated 2.6 million legal and illegal foreign workers. They are critical to the nation’s key manufacturing and agriculture sectors, and many household rely on foreign domestic workers, mainly from Indonesia, Philippines and India.

Strain

Issue of labor force administration in Malaysia has somewhat strained the bilateral ties temporarily. In 2007 Malaysia banned imports of Bangladeshi workers into the country after hundreds of them were stranded at an airport because their employers failed to collect them promptly. There were demonstrations in Kuala Lampur by Bangladeshi workers demanding payments and better conditions. This created a crisis in the bilateral ties but issue has been resolved with the interference of the governments. The government had placed a similar restriction in 1999 but lifted the ban last year by approving an initial intake of 300,000 workers.

A total of 8,32,609 Bangladeshi workers got immigration clearance to go abroad with employment until December 31, 2007 since the present caretaker government came to power. Of which, more than 5,71,000 workers were sent to different countries including Malaysia with employment. The countries where Bangladeshi workforce went include Saudi Arabia, Malaysia, United Arab Emirates, Qatar, Oman, Bahrain, Libya, Kuwait, Singapore, Brunei, Jordan, UK, Italy, Mauritius, Lebanon and Ireland. After a gap of 10 years, Malaysia started importing manpower from Bangladesh from October 22, 2006. And so far 2,45,000 16 workers went to Malaysia until December 31, 2007.

Dhaka and Islamic world

Dhaka’s relations with Malaysia are a part of its entering into close ties with Islamic world. The road of Bangladesh to endear itself to Islamic world has been long and strenuous, though. The country began a constructive course in international affairs soon after Bangladesh was admitted to the United Nations in 1974 and it was elected to a Security Council term in 1978 and again for another term 2000-2002. Bangladesh served as the chair/president of the 41st UN General Assembly in 1986.

Following the recognition of Bangladesh by Pakistan in 1974, Sheikh Mujibur Rahman led a Bangladeshi delegation to the Organization of the Islamic Conference (OIC) conference in Lahore upon which Bangladesh was admitted as a member. In 1977, the President Ziaur Rahman amended the Constitution of Bangladesh, including a clause stating that "the state shall endeavor to consolidate, preserve and strengthen fraternal relations among Muslim countries based on Islamic solidarity". Since then, an explicit goal of Bangladeshi foreign policy has been to seek close relations with other Islamic states.

In 1983, Bangladesh hosted the foreign ministers meeting of the OIC. Bangladesh's geographical location at the crossroads between South and South East Asia and East Asia beyond, makes it naturally advantageous for Bangladesh to pursue a well rounded and balanced policy of cooperation and friendship with all the Asian countries as much as with India, Pakistan and the other South Asian nations as with Myanmar, Thailand and other South-east Asian nations.

There has been a momentum in the strengthening of the relations with South East Asian Countries. Under the free market policies pursued by the four-party alliance government of Prime Minister Khaleda Zia, the country has made big strides and sustained a GDP growth of around five per cent, stable macro-economic environment, achievement of food self-sufficiency, reduction of poverty and improvement of social indicators like higher literacy, better rights for women and children, rule of law, human rights and good governance.

Free Trade Agreement

As the ties with Malaysia grew in volumes, the Bangladesh business community seeks now a free trade agreement (FTA) put on track quickly to help enhance the two-way trade with Malaysia and help slash the widening trade deficit affecting the South Asian nation. Though the proposed FTA was mooted in 2004, it failed to materialize but now with Bangladesh-Malaysia trade relations on the surge, a comprehensive trade pact could help encourage trade and cross-border investment flow. This FTA proposal merits serious consideration and examination. “We believe in strengthening our relationship with Malaysia. In many ways Bangladesh and Malaysia share many common values, there are lessons to learn from each other," Bangladesh's Advisor to the Ministry of Foreign Affairs, Expatriates Welfare and Overseas Employment, Dr Iftekhar Ahmed Chowdhury.

He inaugurated the first Showcase Malaysia 2008 event in Dhaka in April, jointly organized by BMCCI and Malaysia South Association, where nearly 75 Malaysian companies, government agencies and industry captains are participating in the three-day event, largely to expose Malaysian businesses to Bangladesh. On a similar note, Malaysian High Commissioner to Bangladesh, Datuk Abdul Malek Abdul Aziz, who is also the patron of the Bangladesh-Malaysia Commerce and Industry (BMCCI), said a FTA would certainly add momentum to the current trade relations.

Bangladesh is the only nation among the world’s 49 least-developed countries (LDCs) to be almost self-sufficient in the production of pharmaceuticals - largely branded generic drugs. Moreover, its drug exports - to 68 nations - grew 47% to $28.12 million in 2006-7 and, at $23.63 million, they have beaten first-half 2007-8’s target of $15.63 million by over 51%, the nation’s Export Promotion Bureau (EPB) reports. With proper government support to help Dhaka enters the world’s highly-regulated markets, Bangladeshi industrial conglomerate’s pharmaceuticals arm, BPL, could create an export market worth over 10,000 crore taka ($1.5 billion) by 2009.

The Bangladesh Association of Pharmaceutical Industries (BAPI) expects this growth rate to double in the second half of this year, as the industry looks to expand its business beyond the less-regulated Asian markets of Myanmar, Nepal, the Philippines and Vietnam, where its products have faced very little competition. They are now moving successfully into moderately regulated markets such as Russia, Ukraine and Singapore and are looking at Western Europe and the Gulf Cooperation Council (GCC) states of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE).

Recently, Malaysia's leading education institutions, port operator, healthcare provider and pharmaceutical company visited Dhaka to explore the new market with nearly 140 million people and possibly use Bangladesh to penetrate the huge South Asian market, home to nearly 1.3 billion people.

Future

Trade and cooperation are increasing year by year between Malaysia and Bangladesh and both are forecasting sharp increases in their pharmaceutical exports, business groups are calling for the establishment of a Free Trade Agreement (FTA) between the two nations. One reason is that Bangladesh’s total exports to Malaysia - its largest investment partner among the Association of Southeast Asian Nations (ASEAN) - were worth just US$16.9 million in 2006-7, while its imports from there totaled US$384.16 million.

Many Malaysian companies have shown keen interest to participate in infrastructure projects here such as power generation, sea port development, waste disposal system, construction of roads and highways as well as in the service sector such as education and healthcare. Malaysia said will continue to contribute positive efforts to promote and expand bilateral relations with Bangladesh, particularly in trade and investment. Pending projects like the Dhaka-Chittagong highway, worth $1.2 billion, power generation, port development etc would be completed.

As per the available information, Malaysia will invest in the potential sectors in Bangladesh. Malaysian High Commissioner Abdul Malek Bin Abdul Aziz said this when a delegation of Dhaka International Exhibition Company (DIEC) called on him at his Baridhara office here on April 24. The Malaysian envoy assured all technical and logistic support for the upcoming Bangladeshi Single Country Trade Fair to be held in Kuala Lumpur on June 19 to 22.

Abdul Aziz said he would take initiative to get entry of Bangladeshi products at 'zero tariff' in Malaysia, and sufficient number of visas will be provided for the participants of the fair. Malaysia is keen to see Bangladesh promotes market in that country so as to reduce the trade gap, which is currently in favor of Kuala Lumpur. Referring to the demand of Bangladeshi garments, home textile, handicrafts, halal food, spices, ceramic, melamine and medicines in Malaysia, Abdul Aziz said Dhaka could take the opportunity by participating in the trade fairs in his country.

With close contacts emerging at various levels including governments and companies, peoples and services, the Bangladesh-Malaysian ties are slated to be on an ever-steady increase. With more and more agreements being reached, deepening and widening the areas cooperation, the relationship between these friendly Muslim nations would grow stronger.

- Asian Tribune -

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